The seasonally adjusted Markit/CIPS Purchasing Manager's Index (PMI ) posted 51.9 in April, a seven-month low and below the revised March reading of 54.0 (originally 54.4). The PMI has nonetheless remained above the neutral 50.0 mark, signalling expansion, for 25 consecutive months.
The slowdown in the rate of increase of output occurred in tandem with weaker growth of incoming new business, in turn led by a decrease in the volume of new work received from abroad.
Companies reported that the domestic market continued to exhibit a degree of strength, leading to growth of total new orders. However, the sterling/euro exchange rate was also hitting competitiveness in the eurozone, the UK's largest trading partner.
Growth of output and new orders was largely centred on the consumer goods sector during April, with rates of expansion in this market group remaining substantial. In contrast, the intermediate goods sector saw output and new orders fall back into contraction, while investment goods firms posted a decline in new work and slower production growth.
Manufacturing employment increased for the 24th successive month in April, with modest job creation signalled in both the consumer and investment goods sectors. Increased workloads were the primary factor encouraging firms to take on additional staff. Price pressures remained on the downside in April, with both input costs and output charges falling during the latest survey month.
Lee Hopley (pictured), chief economist at EEF, the manufacturers' organisation, said: "Recent data points to a marked loss of momentum in manufacturing activity since the start of the year. While consumer facing sectors are still forging ahead thanks to low inflation and a pick-up in wage growth, any sign that export growth was about to turn around at the end of last year now looks to have been a false dawn.
"Nevertheless, it would be premature to write off manufacturing's contribution to growth in the future, not least because continued employment growth points to some confidence about longer term prospects. Still, this is another reminder that the next government must focus on delivering a competitive and predictable environment to keep business growth on track."
Meanwhile, shortages of certain raw materials led to longer delivery times from suppliers. Average input prices declined for the eighth successive month during April. Where a reduction was reported, this was linked to the euro-sterling exchange rate and higher costs for commodities, oil by-products and some food raw materials. Conversely, there also were some manufacturers reporting an increase in prices paid for dollar-denominated inputs, mainly due to the sterling-US dollar exchange rate.
